Saskatoon Airport Authority

BUSINESS PLAN
2005 - 2009

JOHN G. DIEFENBAKER INTERNATIONAL AIRPORT A PART OF OUR COMMUNITY

Saskatoon Airport Authority | B U S I N E S S P L A N 2 0 0 5 - 2 0 0 9

TA B L E O F C O N T E N T S

01. 02. 03. 04. 05. 06. 07. 08. 09.

Vision, Mission, Message . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 02 Business Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 04 Strategic Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 06 Business Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Business Objectives Deliverables. . . . . . . . . . . . . . . . . . . . . . . . 12 Land Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Facility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Profile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Structure and Mandate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

BUSINESS PLAN 2005 - 2009

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VISION, MISSION, MESSAGE

VISION

Saskatoon John G. Diefenbaker International Airport will remain Saskatchewans Premiere Airport and will be the best mid-sized airport in Canada.

MISSION

The Saskatoon Airport Authority will, in operating an efficient, safe and secure facility, be a leader and partner in the development of Saskatoon and Saskatchewan.

MESSAGE
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Above all, Saskatoons airport is a community airport.

Saskatoon John G. Diefenbaker International Airport is dedicated to providing the finest airport experience for members of the community. It is dedicated to providing a competitive, low-cost airport for the community. It is dedicated to being a catalyst of economic development for the community. The Airport experience brings together a modern terminal building with a commitment to quality service in ensuring visitors to the facility are always impressed. This is truly a people place, with research indicating 68% of Saskatoons population visits the Airport each year. The Airport is equipped to handle growth for years to come, with a capacity to welcome 1.4 million passengers annually. And with projected capital expenditures of $32 million through 2014, our plan is to continue to invest in providing a safe, secure and environmentally responsible operation. A competitive, low-cost airport is the strategic edge capable of attracting both airline service and additional passengers to Saskatoon. The Saskatoon Airport Authority, since its inception in 1999, has a track record of operating as a fiscally responsible business. The financial surplus we achieve in annual operations is re-invested in the airports infrastructure. We are focused on ensuring aviation rates and charges remain at the lowest possible levels. Thats good for passengers and a strong signal to airlines that were a cost-effective airport, encouraging air service to Saskatoon. As a generator and catalyst of economic development, the Airport Authority is committed to being a dynamic organization which supports and encourages growth of the communitys economy. Through partnerships with a range of community organizations, the Airport seeks to be an active participant in a growing community, both in Saskatoon and central and northern Saskatchewan. As a community airport, customer service is our key to continued success. We are committed to responding to the needs of our customers, partners and the community as the core strategy for building the Airports success long into the future.

E. Robert Stromberg Q.C. Chair, Saskatoon Airport Authority

W. A. (Bill) Restall President & CEO Saskatoon Airport Authority

BUSINESS PLAN 2005 - 2009

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BUSINESS ENVIRONMENT

The Saskatoon Airport Authority operates in a dynamic environment, dealing with a spectrum of issues in a constantly changing transportation industry.

Since 1999, a local Board of Directors has been accountable to the community for management and operation of Saskatoon John G. Diefenbaker International Airport. The 60-year lease with the Government of Canada requires the Authority to develop and operate the facility in a safe, secure, environmentally responsible, efficient and cost effective manner, with reasonable airport user charges and equitable access to all air carriers. The Airport Authority conducts a symphony of passengers and planes, co-ordinating a vast array of businesses and government agencies, of security and services, of logistics and supporting players. The Authority doesnt own the planes or schedule the airline routes, yet it bears primary responsibility for ensuring the smooth and efficient connection of passenger and airline, and all the details that important interaction entails. It is the first point of welcome for visitors, projecting our community to the world. The challenges faced by the Airport Authority now and over the next five years are many. The relationship with the federal government, our landlord

and regulator, continues to evolve and change our financial and operational framework. It is expected that these changes will be reflected in the business environment over the next five years. The overall health of the local, national and international economy has a direct bearing on the level of activity at the Airport and the number of passengers who utilize the facility. Any slowing of economic growth, translates into immediate impact on the Airport, both in terms of passenger volume and related revenue. Recent forecasts by the Saskatoon Regional Economic Development Authority indicate that the majority of area businesses are optimistic about their prospects for growth over the next five years with biotechnology, advanced manufacturing, mining, food processing and information technology the most bullish. The airline industry, and the transportation sector of which it is part, are in constant evolution, especially in recent years. During a prolonged period of airline restructuring, the Airport Authority remains dedicated to a combination of prudent management and financial flexibility that allows it to respond to changes in the business environment. Security requirements, ensuring the safety of all who use our airport, are also in a period of rapid evolution. As tighter security is achieved, new relationships with the Canadian Air Transport Security Authority (CATSA) must be developed, new procedures for security screening must be put in place and new demands for equipment and infrastructure must be accommodated. The Airports situational analysis is clear: the world of airline transportation is in a period of constant and rapid change.

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S T R AT E G I C O B J E C T I V E S

The Saskatoon Airport Authority is poised and prepared with a Business Plan that anticipates a period of constant and rapid change.

Airport Experience The sleek new Terminal Building provides the style, function and capacity to comfortably handle the growing flow of passengers through John G. Diefenbaker International Airport anticipated over the next five years. Where the previous Terminal was designed for 500,000 passengers annually, and reached a peak usage in excess of 800,000 passengers, the redeveloped Terminal has the capacity to welcome 1.4 million passengers annually. The smooth flow of passengers entering and leaving the airport, spacious reception areas, a variety of businesses and services along with interesting features such as the Blairmore Ring monument are all designed to extend a warm welcome to visitors. Customer service is enhanced through a fully staffed information centre, a reception booth available free to community groups, and amenities such as three luggage delivery systems and seating with airside viewing.

Low Cost Airport Remaining a low-cost airport represents an important strategic edge for continued growth and development. As one of Canadas most cost-effective airports for airlines to operate from, maintaining the lowest possible aviation rates and charges is key to future success. Achieving the proper price point for air travel is a determining factor in building traffic through the Airport. The Authority is dedicated to financial prudence that demonstrates to both the public and the airlines that Saskatoon offers an efficient and economical base from which to travel by air. The achievement of this objective is becoming increasingly challenging with growing security, regulatory and administrative obligations. Upon taking over the management and operation of the airport, the Airport Authority immediately reduced the aviation fees published by Transport Canada by 11 per cent. Those fees have not increased since then. It is our goal to maintain aviation fees at their current level except in response to increased security or regulatory compliance costs imposed by the federal government, its agencies or regulators, and in response to the introduction of federal rents expected in 2006. Improved Air Service The Airport Authority has in place an aggressive marketing plan to expand both the level of domestic air service and pursue new transborder service. Staff resources are dedicated on a continuing basis to improved air service. Providing airlines with a low cost airport, and working co-operatively with them to ensure success of new routes, is fundamental to attracting additional service.

Economic Generator The Airport is an important catalyst for economic growth in the community and has adopted a vigorous role in working as a partner with local and provincial agencies in encouraging wealth creation. By supporting and facilitating expansion of marketplace growth, including export trade and tourism, the Airport becomes a proactive tool of economic development. Direct Airport activities also support the local economy, with direct economic impact on the local economy estimated at $150 million and indirect and induced economic impact of $250 million. Future Investment The Airport Authoritys initial five-year capital plan was delivered ahead of schedule and within budget. In addition to redevelopment of the Terminal, a number of significant projects were also completed including restoration and expansion of Apron One, installation of a glycol containment system and restoration of Taxiway C. Additional improvements are planned in the years ahead, with capital spending of $32 million scheduled until 2014. Replacement, restoration and conservative expansion will include the next phase of Terminal redevelopment to integrate security measures; restoration of airside assets such as runways, taxiways and aprons; and facility enhancements to roads and parking areas.

BUSINESS PLAN 2005 - 2009

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BUSINESS OBJECTIVES

1. To operate in a safe, secure and environmentally responsible manner by: > Meeting or exceeding industry standards > Maintaining and enhancing the Airport safety program > Maintaining and upgrading the Airport security program > Maintaining a property and equipment damage avoidance program > Continuing an effective and proactive environmental management program > Maintaining a risk assessment and contingency planning program > Maintaining a safe work environment 2. To achieve and operate as a financially viable entity by: > Implementing comprehensive short and long term investment plans > Maximizing all sources of revenue > Maintaining a competitive position with other airports > Providing cost effective service > Performance measurement benchmarking against other airports > Operate within approved operating and capital budgets > Move toward full cost recovery in each operational sector

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3. To provide the traveling public with a first class facility while striving to be user friendly with a quality service orientation by: > Improving the Airport experience > Maintaining and upgrading existing airside and groundside facilities > Providing additional facilities to support growth > Improving customer service 4. To form stakeholder partnerships and relationships with the community, Airport tenants and users by: > Maintaining an Interface agreement with the City of Saskatoon > Ongoing liaison with tenant and user groups > Participating in community area groups 5. To ensure public accountability by: > Maintaining public accountability mechanisms > Implementing a commitment of excellence through strategic planning > Maintaining effective consultative mechanisms with the community at large 6. To pursue marketing initiatives and economic development by: > Implementing an Airport marketing plan > Ensuring compatibility and orderly development of Airport land > Establishing guidelines for the effective use of Airport facilities 7. To support and develop a highly skilled and professional workforce by: > Implementing a human resource plan > Ensuring a succession plan is in place > Ensuring a staff training program is in place 8. To cultivate and promote the Airports role and image within the community and to communicate with the Airport stakeholders in a proactive and effective manner by: > Identifying and building relationships with all stakeholders > Maintaining an effective communications strategy and plan > Aggressively seek community input through working groups of the Airport Community Consultative Committee

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BUSINESS PLAN 2005 - 2009

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BUSINESS OBJECTIVES
DELIVERABLES

To ensure it achieves its annual Business Plan targets, the Saskatoon Airport Authority has established specific and measurable deliverables in eight categories:

Financial Viability The Airport operates within budgets approved by the Board of Directors, with specific revenue and expense targets designed to achieve an annual operating surplus. Financial prudence is the watchword, as all rates and charges are designed to balance competitiveness with a reasonable return to the Authoritys capital fund. Financial planning is structured to promote air service expansion in response to both airline restructuring and market demand, and the Authority is committed to pursuing and developing both existing and new opportunities for revenue generation. The Authority participates in the Canadian Airports Council review of the National Airports Policy, and the resulting lease and rental arrangements. Full comprehensive audits are in place. Consultation with the air carriers operating at the airport is an ongoing process. To ensure responsiveness to and preparation for airline operator and passenger demand, specific consultation has been undertaken to determine passenger traffic expectations for the period covered by this Business Plan.

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Graph 05a | Financial Viability Historical & Projected Operating Revenues & Expenditures

Revenues $11,000,000

Expenses

$9,000,000

$7,000,000

$5,000,000

$3,000,000

99

00

01

02

03

04

05

06

07

08

09

Graph 05b | Capital Expenditures 1999 to 2004 $25 million

$12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 0

99

00

01

02

03

04

13

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Airport Image The image of the Airport will be continually enhanced through a variety of programs including keeping in contact with the public, users and clients through mechanisms such as the Community Consultative Forum and a comprehensive Airport Communications Strategy. Issues and concerns raised by the public will be evaluated and responded to, while the operational integrity and safe and secure nature of the Airport and air transportation will be promoted. Profile of the Airport will be increased through participation in events such as the Canada Remembers Air Show, business trade shows and public events. Community linkages, such as the Blairmore Ring monument and informational display, will be highlighted. Interest in aviation will be cultivated through historical displays and information in the Terminal. Customer/Client Services Quality service is the key to achieving a user-friendly airport which meets the needs of users, clients and the public. Built on a foundation of operational integrity, the Airport is constantly upgrading its services and facilities to improve the Airport experience. Satisfaction surveys are utilized to identify customer and clients needs, and initiatives to deal with those issues are undertaken. Airport Development Public awareness and feedback is continually gathered on Terminal redevelopment already completed, and adjustments to enhance customer service and satisfaction will be implemented as required. Ongoing terminal redevelopment will address security requirements, passenger ticketing and baggage handling. Road and parking facilities, apron expansions and runway/taxiway maintenance are also being assessed and incorporated into the five-year capital plan. Capital expenditures totalling $32 million are projected through 2014.

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Graph 05c | Capital Expenditures Projections 2005 to 2014 $32 million

$6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 0

05

06

07

08

09

10

11

12

13

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Authority Staff A Human Resources Plan is in place and implementation is continuing. Maintaining a strong commitment to staff morale and wellbeing is key to the plan, along with development of a strong working relationship with union representatives. Work is under way on both comprehensive training programs and succession planning. Business Promotion and Marketing A Strategic Marketing Plan is in place which pursues a business-driven philosophy of actively seeking out business opportunities. An aggressive Air Services Campaign promotes enhancement of air service, including development of opportunities to improve air service to northern Saskatchewan and the US west and southwest. Promotion and implementation of a comprehensive land development initiative, including commercial land use development in concert with the City of Saskatoons Plan Saskatoon, is also under way. The Authority encourages joint marketing and promotional opportunities. Market demand will drive development of the Apron 6 and Apron 7 aviation areas, and the Airport Master Plan is being updated to consider future opportunities.

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Partnerships Strong partnerships are key to the success of the Airport. The Authority works with existing airline carriers to enhance current air services and with corporate operators to assist in the growth of their businesses. Relationships with stakeholders and community groups are being expanded, as well as working with Airport service providers such as Nav Canada, The Canadian Air Transport Security Authority (CATSA) and Customs and Immigration to facilitate a strong customer service orientation. The Airport continues to maintain an effective working relationship with the City of Saskatoon. Operational Integrity The Airports risk management programs and plans are subject to ongoing review. Requirements include compliance with all regulations, maintenance of an effective Airport security program and regular updates of the Airport Operating Manual. All service contracts are managed to ensure quality in fire fighting, janitorial, security and terminal services. The Airport maintains a strong environmental management program, addressing such diverse issues as glycol management and bird and wildlife control. An energy management program is in place.

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BUSINESS PLAN 2005 - 2009

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LAND DEVELOPMENT

The Saskatoon Airport Authority, with a land base in excess of 2,000 acres, is experiencing continually increasing interest in land development for both aviation and non-aviation purposes, such as the recent development of several hangars and the Purolator cargo facility. The Airport Land Use Plan provides guidance for development of the airport lands, including the addition of Aprons 6 and 7 in response to the current shortage of airside accessible lots. To take advantage of increasing interest in Airport lands, a new Land Leasing Policy has been introduced to be both more tenant-friendly and increase interest from commercial real estate brokers. Additionally, new airport zoning regulations are being developed to clarify off-airport development constraints. Among concepts under consideration is Prestige Park, a development to house light industry, corporate offices and research and development entities. It would be located west of Airport Drive and south of 45th street. Opportunities to develop additional air cargo and courier facilities have also been identified. As land development proceeds, all initiatives will comply with airport standards consistent with the long term operation of the airport and only compatible uses which exclude residential development will be considered.

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Figure 06a | Airport Land Use Plan

AGRICULTURAL LAND USE

RECREATION NORTH

AUTO WRECKERS YARD

SA S
HW Y 16

NORTH AVIATION RESERVE

EAST AVIATION RESERVE

T-49

T-44

KP LA CE
T-39 T-40 T-42 T-41
19

BEA

MR

OAD

AP RO NI

TE PA RMI RK NA IN L G

APRON
26 27

II

T-

27

APRON V

AGRICULTURAL LAND USE

FIT

APRON VI

T-81

13

APRO

21

45TH

STREET

SOUTH AVIATION RESERVE

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AIRPORT DRIVE EAST DEVELOPMENT MODULE

AIRPORT DEVELOPMENT
CYNTHIA STREET

FUTURE ARTERIAL

LAND USE PLAN

PROPOSED HAMPTON VILLAGE DEVELOPMENT BY DUNDEE

Airport Property Aviation Airside Reserve - Existing Aviation Airside Reserve - Proposed Terminal Area Terminal Parking Commercial - Existing
09

Commercial - Proposed
15

Aviation Reserve Recreation - Proposed Air Cargo Development Addnl Fence Addnl Inner Roads
POND
15

20

AVENUE
09

ARS T-HANG RGO CA

11

20

THAYER

N VII

HANGARS

12

46TH

AVENUE

12

27

15

09

APRON
35

IV
38 41

APRON III PUROLATOR

25

28

LAA

24

29

32 33

37

T-3

17

HANGAR
36 39

40

45 47 44

15

49 16
14

23

30

31

34

46

10

22

STREET

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FAC I L I T Y

Saskatoon John G. Diefenbaker International Airport features two runways, each more than one mile in length, and a state-of-the-art terminal capable of handling 1.4 million passengers annually. The Airport is home to a city within a city, generating more than $250 million in economic impact. The more than 20 land tenant businesses, together with 20 additional businesses in the terminal, have a total of 1,300 employees. The Airport Authority has a staff of 25. The runways can handle any commercial aircraft and have an impressive record for remaining in service. Following a $19 million redevelopment completed in 2002, the 110,000 square foot terminal building boasts smooth customer flow, spacious public areas and an enhanced Customs and Immigration service area. Airport visitors are treated to intimate airside viewing where they can sit nose-to-nose with aircraft on the apron. Arriving passengers are now served by three luggage delivery systems.

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Figure 07a | New Terminal Schematic

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As our Community, economy and demand for air service is certain to grow, our airport must anticipate and be prepared to respond. While long-term airport planning is dynamic and ever changing in response to environmental factors, a conceptual Groundside, Airside and Terminal Building future development plan is critical in ensuring that development does not encumber long-term objectives. The base conceptual plans and the specific details contained in the plans are certain to evolve. The critical element is to ensure that the evolution is consistent with the long-term vision.

Figure 07b | Future Parking and Roadway Development

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Figure 07c | Future Terminal and Apron Development

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Figure 07d | Map of Potential Airfield Development

1
Phase

13

II

2
09

17
POND

5
Access

12

7
33

FUTURE

ARTERIAL

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Airport Property Aviation Airside Reserve - Existing

2. Runway 09 Extension - 290m

3. Parallel Runway 09/27R - 916m x 30m

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4. Taxiway C 5. Taxiway D
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6. Taxiway B Extension 7. Apron VI - Hangars

12

25
33

15

15

15

Phase I
09

AIRSIDE DEVELOPMENT

13

13

1. Runway 15 Extension Phase I - 250m, Phase II - 150m

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Access

Figure 07e | Map of Noise Exposure Forecast

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BUSINESS PLAN 2005 - 2009

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PROFILE

From before dawn to long after sunset, Saskatoon John G. Diefenbaker International Airport is a bustling hub of air travel, receiving and dispatching flights throughout Saskatchewan, Western Canada, and international connector points in Canada and the United States as well as direct charter flights to destinations beyond North America. A number of indicators that profile the historical and projected activity at the Saskatoon Airport follow: Graph 08a | Passengers
900,000 850,000 800,000 750,000 700,000 650,000 600,000 550,000 500,000 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09

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Graph 08b | Aircraft Movements

120,000 110,000 100,000 90,000 80,000 70,000 60,000 50,000

93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09

Graph 08c | Top Ten Destinations

Toronto Vancouver Calgary Winnipeg Ottawa Montreal Edmonton Regina Los Angeles Victoria

17.84% 12.42% 8.43% 7.37% 6.74% 3.92% 2.94% 2.90% 2.73% 2.67%

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Graph 08d | Total Airline Seats in Marketplace (arriving per week)

18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 99 00 01 02 03 04 05 06 07 08 09

Graph 08e | Airline Flights Per Week

600 500 400 300 200 100 0

99

00

01

02

03

04

05

06

07

08

09

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BUSINESS PLAN 2005 - 2009

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S T R U C T U R E & M A N DAT E

The Saskatoon Airport Authority is a non-profit corporation under the Canada Corporations Act and operates under bylaws which follow guidelines set out by the Government of Canada. The Board of Directors consists of nominees from organizations representing the Authoritys range of stakeholders. There are four standing committees to facilitate operations.

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Appointing Organizations Members on Authority Board City of Saskatoon

Federal
(Her Majesty the Queen in Right of Canada)

Province of Saskatchewan
(Her Majesty the Queen in Right of the Province of Saskatchewan)

The Authority

Accountability Framework Public meetings Annual Report Canada Lease Regulatory Compliance Nominator Meetings Stakeholder Meetings Public Notices Community Consultation Civic Leader Briefings

Board of Directors 6 Board Members appointed by the City of Saskatoon 2 Board Members appointed by Government of Canada 1 Board Member appointed by the Rural Municipality of Corman Park 1 Board Member appointed by the Province of Saskatchewan 2 Board Members appointed by the Saskatoon Airport Authority

Standing Committees Governance Committee Safety, Health and Environment Committee Audit and Finance Committee Community Consultative Committee

President and CEO Saskatoon Airport Authority

Manager of Operations Airport Authority

Chief Financial Officer Airport Authority

Manager of Facilities Airport Authority

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BUSINESS PLAN 2005 - 2009

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A B R I E F H I S TO R Y
O F T H E SA S K ATO O N A I R P O R T

1911

A Curtiss-designed airplane owned by Bob St. Henry arrives in May 1911 at the Grand Trunk Railway. After an initial mishap, Mr. St. Henry finally makes the citys first successful flight on June 12, 1911: he circled the field three times, then landed. Glenn Martin, who later became a famous designer and builder of bomber and transport aircraft, thrills audiences at the exhibition with his pusher biplane. His most memorable flight was when he set an altitude record of 6,400 feet on August 9, 1912. Ex-RAF Lt. Stan McClelland establishes a commercial flying operation on what is presently 22nd St. and Dundonald Ave.

1912

1919

1919-22 McClelland also establishes a field near Hudson Bay Slough and operates a flying school to train young Chinese from Canada, the USA and China (for Sun Yat-Sens Revolutionary Army) 1927-28 In January 1927, the Department of National Defense asks the City to establish an airport. Saskatoon Airport. A site is chosen in 1928 and recommended for development and use by the Saskatoon Aero Club, who operate the air harbor with grants from the city and introduce flight training with a deHavilland Moth donated by the federal government.

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1929 1930 1938

The air harbor is licensed for day use on June 1, 1929, becoming only the second licensed air field in the province. Western Canadian Airways provides airmail service linking all major cities in Western Canada. The service ends in 1932 because of the Depression. The City constructs three runways. Prairie Airways Ltd. adds Saskatoon to its route, with daily passenger and mail service.

1940-45 The City agrees to lease the airport to the federal government. The airport is operated by the RCAF until November 1945, the maintenance was taken over by the Department of Transport. 1946 Airport is transferred to the Department of Transport and again becomes a civil airport.

1948-49 Increasingly sophisticated electronic technology rapidly advances the industry. Instrument landing systems were installed on Runways 08 and 32. In 1949, a control tower begins operations. 1950 The RCAF establishes a training station. The RCAF maintained a presence at the airport until 1964, when it closed the entire station and handed over four hangars to the Department of Transport. The airport becomes a Customs port of entry in September 1954. After a year of intensive construction and improvements, the official opening of the new air terminal building takes place in September 1955. Saskatoon Airport becomes the first in Canada to have an air traffic control unit. Grand opening of the new terminal building is held in November 1975. Airport renamed John G. Diefenbaker Airport in 1993. Rebuild of Runway 15/33. Rebuild of Runway 09/27. Airport turned over to the Saskatoon Airport Authority in January 1999. New State of the Art Air Traffic Control Tower opened. Grand opening of redeveloped and expanded Terminal building in October. The Saskatoon John G. Diefenbaker Airport celebrates its 75th Anniversary.

1954 1955 1958 1975 1993 1994 1996 1999 2001 2002 2004

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Saskatoon Airport Authority Suite #1, 2625 Airport Drive Saskatoon, SK Canada S7L 7L1 (306) 975-4274 www.yxe.ca

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